Pay-at-the-Pump, Libya-Style
The revolution currently sweeping across North Africa and the Middle East is having a huge impact on gas prices and is putting strain on shell-shocked consumers, still dusting off the effects of a global recession.
Gas prices have surged to their highest levels since August 2008, rising more than three percent as protests spilled over into Iran. Saudi Arabia too is bracing for further unrest amid concerns that protests in Bahrain and Oman could reach its borders.
Meanwhile, the impact on oil-producing countries has caused a surge in world oil prices up as much as $17 a barrel with pump prices about 20 percent higher than a mere six months previously. The impact, of course, is being felt on other prices such as food and airfare, never mind the poor belaboured consumer. In Canada, pump prices have hit $1.20 a litre, up from $1.01 half a year ago. In California, gas prices have passed the $4 a gallon mark.
Despite all of this sweeping impact, business still sees Libya as a huge boon. Ever since the country slowly started regaining the world’s trust after surrendering two terror suspects accused in the 1988 Pan Am jet bombing, companies have started seeing the country favourably. During the previous decade, the world seemed to be flocking to Tripoli’s tent flaps for meetings with the Gadhafi family. Indeed, Canadian companies were awarded over $1 billion in, among other things, construction contracts.
Now, with the world on the verge of massive change, again, Canadians have to ask themselves questions. Are the ethical concerns of doing business with sketchy countries in cash-based economies worth it? What are the implications of using local Libyan workers and resources after gaining exploration rights? And, despite small advances made with smart cars and other energy alternatives, the world still maintains an overreliance on fossil fuels, placing western societies in a state of “energy welfare.”
Some people say that opening business with the west has helped open windows to the current revolution and has therefore been a good thing. While that point remains dubious, it’s clear that whenever corporate greed surfaces over gushing oil reserves, the world groans just a little more loudly as consumers pay for their trickles with ever-shrinking resources.
